Does Stretch Zone reserve the right to establish alternative channels of distribution within a franchisee's limited protected territory?
Stretch_Zone Franchise · 2025 FDDAnswer from 2025 FDD Document
Section 1.4 RIGHTS THAT WE MAINTAIN
We (and any Affiliates that we may have from time to time) will, at all times, have the right to engage in any activities that we or they deem appropriate that are not expressly prohibited by this Agreement, whenever and wherever we or they desire, including, but not limited to:
Source: Item 8 — Receipts. Any sale made must be in compliance with § 683(8) of the Franchise Sale Act (N.Y. Gen. Bus. L. § 680 et seq.), which describes the time period a Franchise Disclosure Document (offering prospectus) must be provided to a prospective franchisee before a sale may be made. New York law requires a franchisor to provide the Franchise Disclosure Document at the earliest of the first personal meeting or ten (10) business days before the execution of the franchise or other agreement or the payment of any consideration that relates to the franchise relationship. (FDD pages 99–263)
What This Means (2025 FDD)
According to the 2025 Stretch Zone Franchise Disclosure Document, Stretch Zone maintains the right to engage in activities they deem appropriate, unless expressly prohibited by the agreement. This includes activities within a franchisee's limited protected territory.
This means that while Stretch Zone grants a limited protected territory, they retain considerable freedom to operate as they see fit. This could include establishing alternative channels of distribution, provided these actions aren't explicitly forbidden in the franchise agreement.
For a prospective franchisee, this implies a potential risk. Stretch Zone could, in theory, introduce other methods of service delivery or sales within the protected territory, which might compete with the franchisee's business. It is important to carefully review the franchise agreement to understand what activities are expressly prohibited to Stretch Zone within the protected territory. A prospective franchisee should seek clarification from Stretch Zone regarding their intentions for alternative distribution channels and how those might impact the franchisee's business.